More landlords are looking for cheaper properties in comparison to previous years, according to recent data.
Figures released by the Mortgage Advice Bureau indicate that up to 70% of investors for buy-to-let were looking at properties costing £250,000 or less during the third quarter of 2015. This represents an increase of 17% compared to the same period in 2014. Last year, nearly half of landlords considered properties costing between £250,000 and £499,999. This year, that figure has fallen to around a quarter.
The data was provided by information from price comparison websites powered by Twenty7Tec, from more than 250,000 product searches. According to Mortgage Advice Bureau’s head of lending, Brian Murphy, the last month has seen more potential landlords seeking cheaper properties. He added:
“As rental demand remains strong nationwide, opting for a cheaper property can result in more attractive yields. It appears many landlords are looking to invest in areas outside the South of England, where property prices won’t hold them back from making a profit.”
During the third quarter of 2015, the most attractive loan for buy-to-let products was 70% to 79.99%, with 20% searching for this amount. Murphy added that buy-to-let investors may be able to afford higher LTVs, due to lower interest rates benefiting residential and commercial borrowers.
Generally speaking, the better deals are available on mortgages with a lower LTV, although a mortgage adviser who has spent time studying for a CeMAP qualification will be able to recommend the most suitable deal for you.